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It is sensible to advertise a brand new yogurt within the dairy aisle, however what about when Sky buys in-store advertisements at Waitrose? Asda, Boots and Co-op weigh up the chance as a part of The Drum’s newest Deep Dive, The New Retail Landscape.
The retail media market splits manufacturers into two buckets. Endemic manufacturers have long-standing relationships with the retailers, whereas non-endemic manufacturers are firms that aren’t native to the retailer, like leisure and leisure.
Retailers are sizing up the chance and weighing up the challenges for these new entrants to the retail media area.
Last month, Waitrose launched its first-ever non-grocery advertiser to its shops in a partnership with Sky and Netflix. The deal noticed the 2 leisure firms take over the branded of free-standing shows in over 200 Waitrose shops. The advertisements promote the Sky Stream dongle, which has Netflix pre-loaded on the gadget.
Along with the in-store advertisements, the deal contains until messaging, digital out-of-home spots exterior Waitrose shops and placements in Waitrose journal, Waitrose Weekend.
TPF Partnerships brokered the deal and head of partnerships Gill Williams tells The Drum: “The retail space provides an exciting opportunity for entertainment brands to talk to consumers when they are in the right mindset to think about enjoying food at home with quality entertainment.”
According to Williams, buy-one-get-one-free offers seem like waning. “Retailers will need to offer value in different ways and entertainment brands are well placed to do this and elevate the total night in experience,” she says.
The alternative to accomplice with non-CPG manufacturers was touted on the Retail Media Summit UK final week, the place retailers and businesses sized up the potential.
Head of retail media at Asda, Steve Gray, tells The Drum the retailer already has a “wide range” of non-endemic brands promoting on digital placements. Asda has finished this with the likes of Sky, for instance, with a ‘Big Night In’ promotion the place clients can purchase a pizza and a facet and a £5 Sky cinema voucher. “We are starting to build packages that will be attractive to the consumer services companies,” Gray says. “That’s a key strategy for us.”
Despite the passion, there have been retailers who reported challenges when working with these non-endemic firms. While head of Boots Media Group Rosie Houston expressed pleasure concerning the potential funding from the non-grocery class, she says the industrial agreements are very completely different from what Boots is used to, with a desire for quid professional quo agreements.
She says: “They have a different set of standards that they want to work with and it’s harder to activate in-store; the compliance can be a bit of a challenge, which I think our existing customers are a bit more used to working with us on.”
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Houston advises retailers to ensure that any deal is complementary and makes sense for the retailer’s own brand. “That’s really important that we keep that at the forefront.”
In place of in-store advertising, Houston believes non-endemic partnerships can work better when the two companies cut a first-party data deal. “What they’re interested in primarily is your audiences. If you can successfully set up a kind of first-party data engine, that’s where you can allow non-endemic access to your customer but in a way that is a bit more manageable without those structural challenges.”
Co-op is another retailer “exploring” the opportunity to work with new types of advertisers, but its head of member rewards and retail media, Dean Harris, says forging deals is complicated. “If you think of the grocery brands that we do business with all the time, we’ve got good relationships, trust, there are contracts in place,” he says. When it comes to non-grocery brands, he asks the question: “How do you get them that offer and how do you do the deal?”
While Tesco, for example, has established relationships with entertainment and leisure brands through its Clubcard rewards scheme, exchanging points for Merlin vouchers, Harris says: “At Co-op, we don’t talk to Virgin Media or Virgin Experience Days or Sky or Amazon. We’re not in that arena, so it’s hard. There is an opportunity to do it, but we’ve got so much to focus on the core at the minute it’s on the [growing] list of good ideas.”
Read more from The Drum’s latest Deep Dive, The New Retail Landscape.
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